The $1.6 million transfer balance cap magnifies the importance of planning ahead - ANZ technical services manager Rahul Singh.
Before July 1, 2017, there was no limit on the maximum amount of money someone could have when they began drawing a pension from their superannuation. The new limit changes all that.
This change may impact long-term insurance and superannuation planning for clients in various ways.
“In the context of life cover, it means our beneficiaries have a death-benefit pension of no more than $1.6 million with any excess compulsorily exiting superannuation as a lump-sum,” says Singh.
The continuously evolving landscape of superannuation makes it even more important now that clients get the right financial advice and have a plan in place for their long-term financial future.
“We would need to ensure that insurance through superannuation is appropriate for our clients, including having a plan for any monies that exit the superannuation system as a lump-sum,” says Singh.